Drake-Williams Steel v. Continental Cas. Co., 294 Neb. 386

Drake-Williams Steel (DWS) fabricated rebar that was bent too tightly, reducing its reinforcing capacity by ~50% and failing contract specifications for the Pinnacle Bank Arena project.
Some rebar not yet cast was replaced by DWS (no claim). Fifty-two pile caps had been cast with defective rebar; about half required remediation to meet structural requirements.
Rather than demolish and replace pile caps, engineer-approved remediation involved excavating around affected pile caps and installing concrete collars with new rebar epoxied into existing caps; Mortenson (GC) paid remediation costs (~$1.36M) and DWS later reimbursed Mortenson but sought insurance coverage.
DWS sought coverage under primary CGL policies (Employers/EMCASCO) and an umbrella policy (Continental); insurers denied coverage and sued for declaratory judgment; cases consolidated and resolved on cross-motions for summary judgment.
District court granted summary judgment to insurers, finding either no occurrence or that the impaired-property exclusion applied. Nebraska Supreme Court affirmed on different grounds: there was no "property damage" under the CGL policies, so no coverage.

Issue	DWS's Argument	Insurers' Argument	Held
Whether remediation costs constituted "property damage" under CGL policies	Remediation to pile caps is damage to tangible property covered by the policy	Costs were economic loss/business risk to repair insured’s defective work product, not covered "property damage"	Held: No — remediation costs were not "property damage" because defective work had not physically injured other property or caused loss of use compensable under the policy
Whether an "occurrence" (accident) caused the loss	Faulty fabrication was an accidental occurrence triggering coverage	Faulty workmanship is not an "occurrence" causing covered property damage absent damage to other property	Court did not reach occurrence as primary basis, but found no property damage (so no coverage)
Whether the impaired-property exclusion barred coverage	Exclusion should not apply because costs remedied damage	Even if property damage, impaired-property exclusion would apply to restoration of insured’s own work	Court avoided exclusion analysis because no property damage existed
Whether cost to repair/retrofit is an insured tort liability vs. uninsured business risk	Costs arise from consequential damage and thus are insurable	Costs are contractual/economic loss to make work conform to contract — a business risk outside CGL scope	Held: Costs are business risk/economic loss of defective workmanship, not tort liability for physical injury to others; uninsured under CGL

Federated Serv. Ins. Co. v. Alliance Constr., 282 Neb. 638 (Neb. 2011) (burden on insured to show prima facie coverage)
Auto-Owners Ins. Co. v. Home Pride Cos., 268 Neb. 528 (Neb. 2004) (CGL duty to defend where faulty work caused damage to other property beyond insured’s work)
F & H Constr. v. ITT Hartford Ins. Co., 118 Cal. App. 4th 364 (Cal. Ct. App. 2004) (remediation of defective pile caps not ‘‘property damage’’ where defective component did not damage other property)
Wisconsin Pharmacal Co. v. Neb. Cultures of Wis., 367 Wis. 2d 221 (Wis. 2016) (treats repair/replacement costs of defective product as economic loss, not covered property damage)
Zurich Am. Ins. Co. v. Nokia, Inc., 268 S.W.3d 487 (Tex. 2008) (distinguishes noncovered business risk of repairing defective work from covered damage to other property)